Back in the days when The Business was still a newspaper, its editor Andrew Neil boasted the publication, would one day be bigger than The Independent on Sunday and The Observer. As the publisher of a title that has had almost as many lives as a cat, is it is finally time for it to stand and deliver, albeit as a brand extension of its more successful sister title The Spectator?Last week parent company of The Business, Press Holdings Media Group (PHMG), announced the ailing title, now a weekly news magazine, would close; in its place a monthly magazine called Spectator Business is launching in the hope it can piggyback on The Spectator’s bigger brand.

The relaunch marks The Business’ fourth major transformation in a troubled 12-year life which has been punctuated by financial woes, soft circulation and varying distribution models.

But group general manager of PHMG Paul Woolfenden claims that far from the “doom and gloom” media commentary which surrounds the title, it is a strategic play aimed at extending the 180-year-old Spectator brand. He has high hopes it will be able to leverage the brand and attract more upmarket readers and advertisers.

However, it is hard to ignore just how much a departure such a strategy is to what the company was purporting less than 18 months ago. Then, Neil proclaimed that if all went to plan, the magazine would be in profit by 2008. Clearly, this has not occurred.

Many industry observers are viewing this latest “extreme makeover” with more than a little scepticism.

The publication first launched as a newspaper, the Sunday Business, in 1996 by journalist-turned-publisher Tom Rubython. Then in 1998, beset by financial difficulties, the Barclay brothers, stepped in to buy it.

Its intended aim at launch was to be a weekend alternative to the Financial Times. It gained enough respect and recognition to win several industry awards in its early years. Yet critical acclaim failed to translate to commercial success.

The title was also hit by the double blow of the September 11, 2001 terrorist attack on the Twin Towers in New York, and the dot-com crash, which resulted in a global downturn in advertising.

After the Barclay brothers took over the paper in 1998, it made a net loss of £32m between that year and 2001.

After signing a three-year deal with the Press Association to help keep it afloat, the newspaper was relaunched and renamed The Business in January 2002. The following year Neil made a radical change to its distribution model, brokering a deal with Associated Newspapers so that the paper would be distributed free with The Mail on Sunday.

At the time, Neil said the aim was to boost the paper’s circulation to 550,000 by Easter 2004 and turn a profit before the end of the year. Much of its circulation would be achieved via its free distribution model. Neil even went as far as announcing on his BBC show, The Daily Politics, that by Christmas “we will end up selling more than The Independent on Sunday and The Observer”.

But given that The Independent on Sunday has a current circulation of 236,500, and The Observer 444,951, Neil’s growth ambitions seem preposterous: The Business’ circulation reaches just 40,000 – half of which is bulk or given away free.

Universal McCann deputy press director Eve Samuel-Camps recalls the tie-up with The Mail on Sunday, which lasted less than a year, as a “strange period” for The Business.

And while PHMG’s Woolfenden argues that The Business’ aim is “not about the numbers” but the quality of audience, even when it became a magazine it never managed to hit the 55,000 fully-paid sales target it needed to push it into profit.

By comparison, its sister publication The Spectator has managed to post its 11th consecutive circulation increase to 57,153. Among its business competitors, The Economist’s circulation most recently rose 6.7% year on year to 181,374.

The Financial Times has also managed to weather the economic storm. In 2004 its parent company, Pearson, reported that advertising revenue had slumped in the previous year and that the title was unlikely to break even in 2004. But by 2006 a combined performance of its newspaper and website properties saw profits jump by £9m to £11m, due to rising advertising and cost cutting. According to the latest circulation figures it enjoyed a 3% year-on-year growth to 452,448.

MindShare publishing director Paul Thomas says: “[The Business] has always struggled with its distribution model. Its biggest competitor when it was a newspaper was probably The Sunday Times, rather than the FT.”

By the middle of 2006 reports emerged that the paper had been running at an annual loss of £3m, with a paid-for circulation of just 20,000. Neil was forced to concede what many already knew – the Sunday market was simply too crowded.

In October that year, the paper began its new life as a magazine and changed its publishing date from Sunday to Thursday and an initial weekly circulation target of 50,000, positioning itself as the UK equivalent of Forbes in the US.

The change to magazine format was expected to breathe new life into the brand. “I thought when it became a magazine it could have worked,” Thomas says. “But the main issue is there doesn’t seem to be an appetite for people to read it.”

Samuel-Camps says its latest plan to move from a weekly to a monthly frequency makes sense commercially, given how difficult it is to sustain revenue in the competitive weekly market. “But it’s hard when you have a product that’s had so many changes in a relatively short period of time,” she adds.

“The Spectator will give it mileage, but it’s not as if Spectator readers are renowned for their business acumen.”

Ben Hughes, global commercial director and deputy chief executive of the Financial Times, believes it is a wise strategy, but fears that if the publication has not already found its niche in over ten years, then it is not likely to be a very easy sell.

“Is it a newspaper? Is it a magazine? Is it a weekly? Is it a monthly? I would be a bit worried about reinventing myself all the time,” says Hughes.

Whether The Spectator adds the sparkle The Business so clearly needs, or the move proves a reincarnation too far for the ailing title, all industry eyes will be watching with interest.

Facts and figures

1996 The Sunday Business newspaper is founded by Tom Rubython

1998 The Barclay brothers buy the paper after it is hit by financial problems, and relaunch it that year 2001 In March the paper undergoes a redesign, which includes a new colour magazine insert.

Due to the combination of the September 11 terrorism attack in New York and the dot-com crash, the paper suffers from an advertising revenue downturn, and the Barclay brothers seek a joint venture to keep it afloat after the paper fails to make money. In November they sign a deal with the Press Association

2002 In January the paper is relaunched and renamed The Business newspaper

2003 It strikes a deal with Associated Newspapers to have the paper distributed free with The Mail on Sunday, thereby boosting its circulation. The deal is axed within a year but a subsequent tie-up is agreed with Newsquest

2006 In October The Business newspaper closes down and relaunches as a magazine

2008 Press Holdings Media Group announces it will close The Business and relaunch it as Spectator Business, hoping to capitalise on the success of its sister publication The Spectator.

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